Tag Archives: Sheila Kuehl

Governor Arnold Schwarzenegger vetoed a host of health care reform bills on Tuesday. Some of them were to be expected. For example, he struck down Senate Bill 840, Senator Sheila Keuhl’s attempt to create a government-run, single payer system in the state. The Governor has been on record as opposing this approach for years and has vetoed the concept in the past. His vetoes of several bills requiring medical plans to include coverage for certain conditions is also consistent with his previously stated opposition to coverage mandates.

But there were lots of surprises on the list, too. Governor Schwarzenegger vetoed legislation that would have made it far more difficult for carriers to insurance companies to rescind an insured once they’ve accepted an application for individual or family coverage (Assembly Bill 1945 by Assemblyman Hector De La Torre. No carrier practice has garnered more negative press — and bigger fines — than rescission. From a political point of view, AB 1945 was a soft ball. Yet Governor Schwarzenegger struck it down.

He vetoed legislation (Senate Bill 1440 by Senator Keuhl) to compel carriers to spend 85 percent of the premium they take in on medical care — even though this concept was contained in the unsuccessful comprehensive health care reform package the Governor was pushing for last year. The same fate befell Senate Bill 973 by Senator Joe Simitian that would have created a statewide public insurer to link together existing regional and county-based health plans even though it too was similar to a portion of the Governor’s own reform plan.

Governor Schwarzenegger’s veto of Assembly Bill 2 by Assemblyman Mervyn Dymally was especially surprising. It would have expanded the ability of the state’s existing high risk pool to help more Californians unable to qualify for coverage in the private marketplace due to pre-existing health conditions. The program needs significant help to continue to meet its mission. He also vetoed Senate Bill 981 by Senate President Pro Tem Don Perata which would have prohibited “balance billing” by doctors and other care providers.

The Governor had his reasons for keeping these bills from becoming law. His veto message concerning AB 1945 deplored the practice of unfair rescission and listed consumer-protection provisions he would want to see in legislation dealing with the issue. But he noted that AB 1945 was “written by the attorneys that stand to benefit from its provisions” and would lead to unwarranted litigation. Similarly, he preferred a different solution to the problem of balance billing than the approach embodied in SB 981.

Vetoes of this type, over approaches to solving problems, are common. They represent legitimate policy and political differences. The Legislature, for example, considered several bills addressing recission. They could have worked with the Governor’s office to fashion a compromise that he would sign. That didn’t happen. The veto did.

But it’s Governor Schwarzenegger’s rationale for vetoing AB 2, SB 1440, and SB 973 that best illuminates what’s in store for California concerning heatlh care reform. In all three of his veto messages, Governor Schwarzenegger made clear he wants comprehensive health care reform. Piecemeal and incremental changes are unacceptable.

I’ve written previously about why state health care reform efforts usually fail. In my mind, meaningful and comprehensive reform will need to come from Washington. And while enacting such reform has been greatly complicated by the current financial crisis, it still remains near the top of the domestic agendas for both Senator John McCain and Senator Barack Obama.

If the new Congress and the next Administration succeed in enacting dramatic health care reforms, it could preempt laws and regulations at the state level. To me, this suggests the efforts of California’s leaders might best be spent in helping to shape what happens in Washington, DC. Governor Schwarzenegger apparently disagrees.

Governor Schwarzenegger’s vetoes make clear he intends to pursue a California solution. It’s not just what the veto messages say, it’s their political impact that is important. They keep pressure on lawmakers to enact substantial reform. His opponents, for example, will be unable to call for a “time out” on further changes to the system while the new laws are given a chance to work. His allies, while angry at the vetoes, will work all the harder to get their pet reforms enacted.

In some significant ways, the potential for success is greater in 2009 than it was in 2008. Governor Schwarzenegger will be negotiating with a new cast of Legislative Leaders. He will will be working with a relatively new Legislature, many of whom will have no scars with from his previous effort. Yet, unlike in 2007 when he launched the Year of Health Care Reform, a year in which, for most of it, the Governor offered only general principals, in 2009 he can use his defeated reform legislation, Assembly Bill X1-1, as a detailed starting point.

Certainly, the task won’t be easy. It may even be impossible. The state’s finances are in shambles and health care reform is expensive.

But there’s a legacy to be attended to. Plus, the Governor does not like to lose and the defeat of ABX1-1 was both visible and painful. His vetoes are a clear signal of where he’s headed. Expect 2009 to be the Year of Health Care Reform. Again.

With the demise of comprehensive health care reform and the arrival of a horrendous budget deficit, California lawmakers are busy looking for ways to fix what they perceive to be the state’s broken health care system on the cheap. After all, the concerns are still there: too many uninsured, ever increasing health care costs, bad behavior by carriers. And lawmakers can’t spend all their time haggling over budget cuts. So health care reform will be an important part of this legislative session. The issue will no longer be front and center, but it’s still on stage.

One issue the legislature will no doubt act upon this year deal with how carriers cancel the coverage of customers who failed to honestly or completely complete their original applications. Because these rescissions are retroactive to the original date of coverage, the customer and health providers are often left with substantial financial exposure. This is an area that cries out for legislative attention. Carriers have been fined millions of dollars for the practice by state regulators. Consumers are terrified that the coverage they’ve been paying for won’t be there when they need it most. Everyone realizes there needs to be a balance between protecting those who make innocent errors in their applications without rewarding those who purposefully game the system. If there is to be an imbalance, however, most lawmakers understandably would rather err on the side of protecting their constituents rather than insurance company profits.

AB 1945, by Assemblyman Hector De La Torre, would require state regulators to sign off on such rescissions before they take effect. AB 1150 by Assemblyman Ted Lieu aims to prevent carriers from setting targets for cancelling policies or awarding bonuses to their employees based on the number of policies they rescind. It’s unclear whether state regulators want or can handle the responsibilities imposed on them by AB 1945. The bill may simply be impractical. AB 1150, on the other hand, is likely to pass without much controversy.

One of the key features of ABX1-1 was its requirement that carriers spend 85 percent of the premiums they receive on medical care. According to the San Jose Mercury News, this Medical Loss Ratio requirement is reappearing in legislation sponsored by Senate Health Committee Chair Shiela Kuehl. I haven’t been able to find the legislative language advocated by Senator Kuehl. The compromise approach contained in ABX1-1 was widely supported, including by many carriers. It’s unclear whether the new legislation will simply accept that language, in which case it is highly likely to pass, or veer off into new, more controversial directions.

Senate President Pro Tem To-Be Darrell Steinberg is pushing another element of ABX1-1. His bill, SB 1522, would require the Department of Managed Health Care and Department of Insurance to establish five categories of individual plans. Carriers participating in that market would be required to offer at least one health plan in each of those categories. As currently drafted, it appears insurers could offer additional plans, too. This flexibility would preserve consumer choice and allow carriers to continue to innovate new plan designs. If, however, this flexibility is diminished, the results could be harsh for California consumers.

These are just some of the bills introduced prior to the legislature’s submission deadline. Keep in mind, however, that any bill can be amended in virtually any way, so the filing deadline doesn’t have a lot of teeth. The number of bills seeking to reform the health care system is likely to increase before the weeding out process begins. This could be a good thing. It would be nice to see, for example, more focus on controlling health care costs, which is the real root of problems in the health care system.

In any event, 2008 is going to be a busy year for health care reform advocates. It won’t make as many headlines as 2007’s efforts, but that doesn’t mean this year won’t be even more significant than last year.

Few pieces of major legislation in recent years have been subjected to the scrutiny Assembly Bill X1-1 received last week. ABX1-1, the compromise health care reform bill proposed by Governor Arnold Schwarzenegger and Speaker Fabian Nunez, was the topic of an 11 hour hearing by the Senate Health Committee on January 23rd and a thorough analysis of its finances by the Legislative Analyst’s Office. Indeed, it was the LAO report that opponents on the committee cited most in justifying their position.

Now other health care reform proposals are about to go under the same microscope. Speaker Nunez has promised nothing less. And first in line is likely to be the single-payer legislation, Senate Bill 840, championed by Senate Health Committee Chair Sheila Kuehl.

Supporters of ABX1-1 held a press conference on Tuesday to affirm their commitment to enacting comprehensive health care reform for California. During his turn at the microphone, Speaker Nunez referred to ABX1-1 as a “road map to getting the right type of health care that we need, to be a bridge between those who want government run health to those who want the private market to dictate the pace of how health care is delivered.” He pledged to continue to pursue this type of reform.

At the same time, he made clear his intent to hold proponents of competing systems — and specifically single-payer proposals — to the high degree of scrutiny to which ABX1-1 was subjected. It’s worth noting that among ABX1-1’s most vehement opponents was the California Nurses Association. They insist the only health care reform worth enacting is one that eliminates the health insurance industry and turns health care over to the government.

“I think it’s time … to have an honest conversation about single payer,” the Speaker said. “We cannot create the false sense of hope that we can do something better if it hasn’t been tested, vetted and put through the same type of scrutiny that our effort has been put through. And I intend to put each and every proposal that seeks to cover health care for everybody through that same process, because I think it’s only fair. And because I also believe that we need to be comparing any proposal not to some wishful thinking of what we might be able to do two decades from now, but to the world we live in today.”

In the past Speaker Nunez has supported SB 840. In introducing his own reform package early last year, Assembly Bill 8, he commented that while he preferred a single-payer solution he accepted Governor Schwarzenegger’s promise to veto it. Yet now he seems intent on demonstrating that SB 840 presents an even greater financial risk for the state than did ABX1-1. And that shouldn’t be hard to do.

Sacramento Bee columnist Daniel Weintraub recently commented on similarities in the risks posed by SB 840 and ABX1-1. “[T]he single payer plan, to be financed primarily by a 12 percent payroll tax, would have run up a deficit unless its managers could have slowed the growth in health care costs to below the level of the growth in wages — an extremely unlikely prospect. To control those deficits, the commission to be put in charge of health care would have been empowered to cut benefits and levy co-payments on consumers. Hardly a risk-free undertaking.”

ABX1-1 was subjected to extraordinary scrutiny. What’s surprising is that such vetting is extraordinary. Major legislative initiatives — especially on issues that touch the lives of Californians as profoundly as health care reform — should be put under an ABX1-1-like microscope. This kind of detailed evaluation is, after all, what legislators are supposed to do. If some popular proposals are found to offer nothing more than a false sense of hope, so be it. Better to learn that now than after it’s enacted.

More significantly, it’s this approach that will help lawmakers find responsible ways to address challenging and complex issues. Ways that few might consider perfect, but that the majority can conclude with confidence, is an improvement to the status quo.

There are seven Democrats and four Republicans on the committee. Two of the Democrats have announced their opposition to the bill and none of the Republicans have ever said anything indicating they’re supporting the bill. That means the bill fails five-to-six. And that assumes none of the other Democrats decides to vote against the bill.

Seems to me there’s only three ways to turn this around:

1. Stack the committee. It’s been done before. Replace a no vote with a yes-Senator. But Senator Perata told the San Jose Mercury Newshe won’t do this.

2. Get a Yes vote from one of the Democrats currently committed to voting No. Committee Chair Shiela Kuehl or Senator Leland Yee have both come out against the bill. In his opening statement to the committee, Senator Perata took a none too subtle swipe at Senator Yee in his prepared statement before the start of the Health Committee hearing. “I am a little dismayed that some committee members have seen fit, or maybe one committee member, is seeing fit to pre-judge the LAO’s report without reading it. Be that as it may, I guess we all approach our work in a different manner.” As means of persuading someone to change their minds on one of the most public and publicized decisions of their political career, this approach leaves something to be desired.

More likely is that Senator Perata, the Governor and Speaker will seek a courtesy vote from one of the Democrats. Their argument could be: 1) you’ll get to vote no on the floor of the Senate; 2) we’ll owe you big time; 3) you’ll keep your office; and 4) eventually the voters will decide if they like this health care reform — why would you stand in the way of letting the people decide?

This last argument might — emphasis on the word “might” — work. ABX1-1 is entirely dependent on a funding measure passing on the November 2008 ballot. If the initiative fails, the bill never gets implemented. So moving the bill forward can be seen as simply giving the people a chance to make the final determination. Will either Senator Kuehl or Yee buy into this? That’s a big unknown.

3. Get a Republican to vote Yes. It’s worth a try. However, the most likely GOP Senator to buck the party is Senator Abel Maldonado. He was, after all, the only Republican Senator to support the 2007-08 budget during the 52-day standoff.

However, according to someone who was there, at a meeting with constituents on Friday, Senator Maldonado expressed concern about committing the state to substantial new expenses before the state’s $14 billion deficit is fixed. As the observer described it, Senator Maldonado explained that everything he knows from his own business experience and his commitment to being a responsible elected official points to a “No” vote on Monday.

OK, there’s a glimmer of a chance that the troika can find a courtesy vote. Or they can convince Senator Maldonado to listen to their financial analysis and not that of the non-partisan and highly respected Legislative Analyst. But it’s a long shot.

Nonetheless, some Sacramento insiders, even some opposed to the bill, are convinced they’ll pull it off. The Governor, Speaker and Senate Leader simply have too much invested in ABX1-1 to let it fail this close to the finish line.

I can’t figure out how they could do it. But if any of you have a guess — or better yet, inside information — please share with the class.

The Governor wants the bill passed. The Assembly Speaker wants the bill passed. The Senate President Pro Tem may want the bill passed — or not, it’s hard to tell. Anyway, several powerful unions want the bill passed. So do some business groups and consumer groups. So why is Assembly Bill X1-1, California’s comprehensive health care reform package in danger of failing to make it past its first committee hearing?

On January 23rd, the Senate Health Committee is expected to dive deeply into ABX1-1. The hearing will start in the morning and is likely to go into the evening. (Here’s the anticipated agenda). But how thoroughly a bill is reviewed doesn’t always correlate with its viability.

What’s endangering ABX1-1 is the make-up of the Committee. There are seven Democrats and four Republicans on the Senate Health Committee. When it comes to ABX1-1, the four Republicans will certainly oppose it. That means supporters can only afford to lose one of the Democrats. Lose two and the bill fails.

There are at least two Democrats who could vote against the measure. The Committee Chair, Senator Sheila Kuehl, has been an outspoken critic of the compromise bill. The legislature’s chief proponent of a single-payer health care system for California, Senator Kuehl voted against Speaker Fabian Nunez and Senator Perata’s previous health care reform bill, Assembly Bill 8. And most observers would be surprised to see her vote for that bill’s successor.

Another Democratic considering a “no” vote on ABX1-1 is Senator Leland Yee of San Francisco. The Associated Press, in a story posted on the San Francisco Chronicle’s SFGate.com web site, quotes Senator Yee as saying, “It’s rather difficult for me to vote for a health care plan that’s going to cost $14 billion at the same time I’m looking at cutting $14 billion” due to the fiscal crisis facing the state.

The non-partisan and highly regarded Legislative Analyst’s Office (LAO) is preparing a detailed report on the legislation’s impact on the state’s finances. Senator Yee will be relying heavily on this report in determining his vote. “I think all of us are trying to find something that’s going to be of help to the people of California and not in any of the out-years find that there are unintended consequences or that it’s going to shift the burden of costs to workers unfairly,” the Associated Press writer Steve Lawrence quotes Senator Yee as saying.

None of this means that ABX1-1 is doomed. Senator Kuehl could vote for it in Committee as a courtesy to the authors regardless of how she intends to vote on the bill when it reaches the Senate floor. The LAO report could show, as some believe it will, that the state’s financial situation would benefit from passage of ABX1-1, meaning Senator Yee could comfortably support the legislation. There’s numerous plausible scenarios that have the bill sailing through the Committee.

Then again, it’s easy to come up with scenarios that have ABX1-1 crashing in flames. It’s tough to tell how hard Senator Perata will be pushing to get the legislation through his chamber, so the pressure to pass the bill along may not be as strong in the Senate as it was in the Assembly. The LAO report could raise questions that make Senator Yee — and perhaps others — unable to support it. Or the Committee’s thorough review of the bill could bring to light previously unknown structural or drafting problems with ABX1-1 that are severe enough to have the committee hold the bill over. This is, after all, the first real vetting this version of the legislation is receiving.

We won’t know until Wednesday evening. What’s surprising, at least to me, is that the outcome is in doubt at all. It’s actually an encouraging turn of events. After all, this is how the legislative process is supposed to work: lawmakers making up their minds based on public input, thorough analysis and their political beliefs.

Previously I’ve written about the thorough vetting Assembly Bill X1-1 was likely to receive before the Senate Health Committee. That should be Vetting, with a capital “V.”

ABX1-1, the compromise health care reform package has yet to be subjected to a thorough, formal review. Drafted by Governor Arnold Schwarzenegger and Assembly Speaker Fabian Nunez, it passed the full Assembly the same day it was printed in final form. This may be business as usual in the legislature, but it’s no way to review complex, complicated and critical legislation.

So Senate Health Committee Chair Sheila Kuehl is doing Californians a favor by making the time to thoroughly analyze the bill. Her motivation may be fueled, at least in part, by her numerous problems with ABX1-1 (as described in that previous post), but who cares? What’s important is that lawmakers understand what’s in the bill before they vote on it.

Senator Kuehl’s approach to reviewing the bill, breaking it up into manageable pieces, should make it easier for Senators to dive deeply into different aspects of the legislation. One can question the way it’s broken up. For example, reviewing the mandate on residents to maintain minimum creditable coverage separate from the market reform which requires carriers to issue coverage regardless of an applicant’s health condition, is a bit disjointed. The reason a mandate to buy coverage is necessary is to make the mandate to sell policies work. However, that’s a relatively minor quibble with the approach. Far more important is that details of the bill will have a better chance of coming to light.

The Committee will take up the bill on January 23rd at 9:00 am. Based on the agenda the hearing should last all day. While all witnesses are created equal, some are more interesting than others. The representative of the Legislative Analyst’s Office (LAO) will be the marquee witness. Senate President Pro Tem Don Perata asked the LAO to analyze the impact ABX1-1 was likely to have on the state’s finances back in December when he felt passage of health care reform legislation before Sacramento addresses the state’s budget crisis was “imprudent and impolitic.” He’s since managed to overcome his reluctance, much as Governor Arnold Schwarzenegger seems to have overcome his concerns about changing the state’s term limit laws without redistricting reforms. Coincidence? Nahhhh.

Anyway, back to the hearing, Elizabeth Hill, the Legislative Analyst, is highly regarded by legislators of all parties. Her office’s report will be highly influential if,and it’s a big if, it makes definitive statements instead of couching it’s findings in an ocean of hedges. If the report is full of “ifs,” “potentiallies” “coulds” and “perhapses” then it’s impact will be muted, unless Committee members can get the LAO’s representative at the hearing to refine the conclusions a bit. We’ll have to wait a few more days to see if that will even be necessary.

For those who want to follow along at home on the 23rd (again, beginning at 9:00 am), the hearing will be broadcast online. To listen in, visit the California Senate’s web site and click on room 4203. The Committee’s expected agenda, subject to change, follows:

Assembly Bill X1-1, the California health care reform package worked out by Governor Arnold Schwarzenegger and Assembly Speaker Fabian Nunez, will receive its first Senate hearing on January 16th before the Senate Health Committee. (Update as of January 14, 2008: It appears the Senate Health Committee will take up ABX1-1 on January 23rd, not the 16th). This hearing will focus more on the policy issues underlying the legislation. While the financing scheme underpinning the bill will no doubt be debated, that topic is more in the purview of the Senate Appropriations Committee, which will hear the bill later, assuming the Health Committee moves it forward.

Which it is nearly certain to do. However, that doesn’t mean the Health Committee hearing will likely be an easy time for sponsors of ABX1-1. That’s because Senator Sheila Kuehl chairs the Health Committee.

Senator Kuehl is intelligent and politically savvy, a potent combination. She won’t frustrate Senator President Pro Tem Don Perata’s plans for ABX1-1. If he insists the bill move out of her Committee, it’s will in all likelihood move out of her Committee. But that doesn’t mean Senator Kuehl will give the bill a free ride. Expect tough questions and an insistence on thorough answers.

In anticipation of the January 16th hearing, I thought it would be interesting to explore Senator Kuehl’s views on ABX1-1, the Health Care Security and Cost Containment Act as it is officially known. To get straight to the bottom line: she doesn’t like it.

Senator Kuehl has written extensively over the past year on the Governor’s health care reform efforts. As the most ardent advocate of a government-run, single-payer system, Senator Kuehl was predisposed against the public-private sector approach advocated by the Governor to begin with. And she approves of little of what’s contained in the bill that emerged, or in the way ABX1-1 was fashioned.

Process: Back when it looked like the legislative leaders and the Governor might produce a bill before the regular legislative session ended in mid-September, Senator Kuehl posted a statement on her web site warning “[t]he prospect of legislative staff, sitting behind closed doors, hastily crafting a 100-page health reform ‘compromise’, to be pushed through the legislature with little or no public input over the course of the next 14 days, is deeply irresponsible. Frankly, given the example of the energy deregulation bill, we ought to know better. ”

As it turns out, it took a special session and several more months of negotiations to work out the compromise that became ABX1-1. And while there was extensive consultation with the public and stakeholders, it was only avialable in printed form hours before the Assembly passed the legislation on December 17th.

No one can seriously claim the bill was thoroughly vetted by Assembly Members prior to that vote. Given her previous statements, it’s clear Senator Kuehl will want to make sure it receives the review legislation this complex — and this important — deserves.

Policy: The vetting will no doubt be thorough. There’s not a lot in ABX1-1 Senator Kuehl likes. In an essay posted on her site shortly after the Assembly vote, Senator Kuehl makes it clear she’s underwhelmed with the bill’s scope and unhappy with its approach to addressing health care in California. “The press has described the bill in breathless prose as a ‘giant leap’ for health coverage. Unfortunately, this is not quite the case, depending on who you are and how and where you work…. [S]ome of the provisions of the bill [are] actually harmful to regular, working-class and middle-class families. And it provides less help than advertised for poor families, as well.”

She objects to the characterization of the bill as “providing” health care coverage to residents, noting that it’s more accurate to say “Californians would be required to buy insurance with no caps on premiums, no regulation of the cost of insurance or medical expense, no maximum deductibles, and no floor on how little coverage you can buy and satisfy the legal requirement.”

She laments the failure of the bill to define the minimum coverage Californians must have. And how the bill deals with recission of policies by carriers. And how insurers would still be able to maintain provider networks. And how medical assistants working in retail clinics would be subject to less supervision by Nurse Practitioners and Physician’s Assistants.

In short, she finds a lot not to like in the bill.

Senator Kuehl supports creation of a single payer system for California not out of political calculation, but from deeply held beliefs that it’s the right approach for the state and the nation. She knows that if ABX1-1 becomes law it will make it harder to pass her bill, introduced in the past two legislative sessions as Senate Bill 840, to succeed.

As I’ve noted previously, many progressives who support SB 840 seem willing to accept ABX1-1 as a partial victory. Senator Kuehl and a significant number of her strongest supporters are not. Senator Kuehl was one of the few Democrats in the State Senate to vote against AB 8 last September, the health care reform plan sponsored by Speaker Nunez and Senator Perata. Based on her writing, she’s doesn’t think ABX1-1 is much of an improvement.

Meanwhile, her allies, the California Nurses Association are actively campaigning against the bill. They’ve gone so far as to include snippets of a speech by Senator Barack Obama — without his or his campaign’s permission — in radio ads opposing ABX1-1.

None of this means ABX1-1 won’t make it through the Senate Health Committee. It is all but certain to do so. What it does mean is that, at long last, ABX1-1 will have a thorough, rigorous and comprehensive vetting. Whether you support or oppose the bill, that can only be a good thing.

(Note: A January 14th editorial in the San Diego Union provides more insights into Senator Kuehl’s concerns about ABX-1-1. My thanks to agent Bill Robinson for pointing this out).